Global Snapshot: Carbon Emissions Stabilize, but Action Still Needed

For the third year in a row, global carbon emissions from the energy sector were flat, according to the International Energy Agency. What’s impressive is that this plateau in emissions comes at a time of economic growth around the world, suggesting that improved energy efficiency, renewable energy production and other factors are driving a decoupling of economic activity and carbon emissions.

However, the current level of energy-related investments needs to double to avoid raising the global average temperature by two degrees Celsius. That benchmark—two degrees Celsius—would still have a substantive effect on climate change, but is a goal preferable to allowing temperatures to climb without restraint. A separate report conducted by the IEA and International Renewable Energy Agency concludes that to avoid that temperature rise, emissions need to peak by 2020 and plummet from current levels by 2050.

Three Years: A Stall

Energy-related carbon dioxide emissions amounted to just over 32 gigatons for 2016, the same as the previous two years. The global economy, meanwhile, grew by 3.1%, according to estimates from the IEA. The United States and China, the planet’s two largest energy consumers, dropped, helping to offset increases in developing countries.

In fact, the biggest cut in emissions was in the United States. Carbon dioxide emissions were reduced by 160 million tons, or 3%, while the economy modestly grew by 1.6%. Increased natural gas supplies account for some of the decline, so this certainly doesn’t signal a total rejection of fossil fuels. That said, renewable power generation did increase, displacing some reliance on coal.

“These three years of flat emissions in a growing global economy signal an emerging trend and that is certainly a cause for optimism, even if it is too soon to say that global emissions have definitely peaked,” said IEA Executive Director Dr. Fatih Birol. “They are also a sign that market dynamics and technological improvements matter. This is especially true in the United States, where abundant shale gas supplies have become a cheap power source.”

Renewables accounted for over half of the world’s growth in electricity demand last year. Half of that growth was in hydropower while global nuclear capacity was at its highest since 1993. The good news is that the demand for coal fell worldwide with the most precipitous drop here in the United States where demand went down by 11%. In fact, natural gas surpassed coal for the first time last year in the United States.This decoupling of emissions from economic growth was driven primarily by reductions in new technology, concerns about air pollution and climate change and other market forces. While the pause in emissions growth is positive news to improve air pollution, it is not enough to put the world on a path to keep global temperatures from rising above 2°C. In order to take full advantage of the potential of technology improvements and market forces, consistent, transparent and predictable policies are needed worldwide.

Thirty Years: Take Action

According to the IEA/IREA report, global carbon dioxide emissions must be reduced by 70% from today’s levels by 2050 if we are to avoid a two-degree Celsius rise in average temperature. And it won’t be easy; some of the measures they identify could come about in that time by market pressures, but others will take decisive action.

For example, they cite the role that electric vehicles can play, saying that seven out of every ten vehicles sold by 2050 should be electric. The market share for electric vehicles around the world is currently 1%, but trending upwards. China has seen incredible growth in this sector, as electric vehicle market share grew from an almost nonexistent .08% in 2013 to .84% in 2016. That’s still a meager portion, but an order of magnitude increase in only two years and equal to about 130 million more electric vehicles on the road. That said, it pales compared to Norway’s more than 22% market share in 2015.

Drastic transformation in the energy sector, however, will necessitate ambitious change to policy. The report identifies low-carbon solutions, which include renewables, nuclear and carbon capture and storage of fossil fuels. To truly disrupt the energy sector by 2050, some challenging policies would need to be in place. These include increased carbon taxes, electricity market reform, eradicating fossil fuel subsidies and energy efficiency mandates. The report doesn’t pretend that fossil fuels will leave the marketplace over the next 33 years, but it remains pragmatic as the decline in demand for coal and oil will be offset by a greater decline in fossil fuel production.

One significant obstacle is end use: industry, transportation and the built environment. The report assumes that energy use wouldn’t increase by 2050, which doesn’t track with current trajectories. Growing populations and economies mean that energy efficiency globally would have to improve by 2.5% every year until 2030 in order to maintain our current energy use intensity.

Hopefully, the pause in global carbon emissions over the past three years isn’t an aberration. It could be a flatline, signaling the death of any union between a growing economy and rising emissions. If those two metrics can be decoupled, then market pressures forestalling action on climate change will cease to matter.